Nothing, however, comes close to the General Motors deal. The US carmaker's plan to acquire an 11 per cent stake fell apart last year. Shares remain far below 2020 heights, when Nikola hit a near US$29 billion equity valuation. Its market cap is now US$3.7b.
The SEC payment bodes ill for start-ups in electric vehicles, or flying taxis, thinking of making wild claims in a bid to attract attention. Regulators are taking an increasingly cautious approach to hype.
Nikola was once the ultimate meme stock. Euphemistically known as "pre-revenue", it joined markets in June 2020 via a reverse merger before it managed to deliver any vehicles. The vision was all. Nikola wants to make hydrogen-powered vehicles and fuel stations, leasing vehicles with fuel-to-fleet operators. The company says one model will have a 900-mile range. Anheuser-Busch is due to receive its first hydrogen fuel-cell vehicles.
Hydrogen is an alternative fuel regarded as key to decarbonising the global economy. But infrastructure is at an early stage.
For now, Nikola is delivering its more modest battery-electric semi trucks. These claim a 350-mile range. Delivery will stabilise the stock price until hydrogen fuel-cell trucks are produced. For Nikola, credibility now rests on proof.
- Lex is a premium daily commentary service from the Financial Times.
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